It needs work.
I am not a game maker so I can not tell you what to do with the actionscript. I can however, tell you that the animation needs a lot of work. the creature explosions should be converted into movie clips with about 10 to 15 frames of explosion or death. Try and work on your background work. I like the building effects. It is hard to do that kind of thing. Anytime I shoot a gun and there is a hole in the wall I am impressed. You should work on the hit area a little more. Make it a little better. I know this is a demo but you need to look at some old school 2d shooters. They can tell you whats up. Never try to go 3d unless you go all the way. Don't have 2d monsters in a 3d arena. I think it is better than I can do. But I still think that whay I said before is what it needs.